Teradata Corporation

Good afternoon. My name is Mariama and I will be your conference operator today. At this time, I would like to welcome everyone to the Q1 Teradata Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during that time, please press star then 1 on your telephone keypad. If you would like to withdraw your question, please press the pound key. Thank you. I would now like to turn the call over to Greg Swearengen, VP of Investor Relations. You may begin your conference.

Good afternoon, and welcome to Teradata's 2019 First Quarter Earnings Call. Oliver Raffensperger, Teradata's President and Chief Executive Officer, will lead our call today, followed by Mark Culhane, Teradata's CFO, who will then discuss our financial results. Our discussion today includes forecasts and other information that are considered forward On today's call, we will also be discussing certain non-GAAP financial information which excludes such items as stock-based compensation expense and other special items described in our earnings release, including acquisition, reorganization-related costs, asset impairments, and capitalized software development costs. We will also discuss other non-GAAP items such as free cash flow and constant currency revenue comparisons. A reconciliation of our GAAP results to our non-GAAP results and other information concerning these measures is included in our earnings release, which is accessible at investor.terradata.com. A replay of this conference call will be available later today on our website. Terradata assumes no obligation to update or revise the information provided during this conference call, whether as a result of new information or future results. And now I'll turn the call over to Oliver.

Good afternoon, everyone. Since my appointment and many more. and leverage their organization's data regardless of scale, volume or complexity. This provides an excellent starting point for today's conversation. As it is clear, we have the right strategy and are executing to win. In Q1, we grew recurring revenue by 13% in constant currency, grew ARR by 12% in constant currency and exceeded guidance for EPS. We also remain very pleased with the rapid rate that customers are continuing to adopt our subscription model. Mark will cover these and other financial results in more detail in a few minutes. Today I will highlight four key takeaways for you. First, we have made significant progress in executing our strategy. Second, strong demand continues for our Territory Advantage platform and we are increasingly Third, we have introduced new as a service offerings for Vantage to help customers apply their focus to getting the answers they need rather than managing their infrastructure. And finally, I'll share some of the outstanding recognition our technology is receiving from leading industry analysts. As we get started, it is important to note that we have made significant progress in executing our strategy and realigning our go-to-market model. We focused on and completed the alignment of our sales teams to provide differentiated coverage of our target megadata customers. As a reminder, these megadata companies are the world's most demanding large-scale users of data requiring massive scale and speed. We're also making progress in aligning our consulting resources to higher value and higher margin engagement. We also saw existing customers increasingly turn to Vantage to help them utilize their data to find the answers to their toughest challenges. Let me highlight a few examples. Air France KLM Group is expanding its analytic ecosystem with Vantage, performing cross-channel analytics for improving services and customer experiences as it analyzes the sequence and path of the customer's interactions through different channels. and many more. One of the world's largest transportation companies has chosen Vantage as the most reliable and robust solution for reducing data silos and harnessing different data at scale. It is leveraging Vantage to deliver improvements in business operations, including lowering fuel costs, increasing safety, and managing their network. Barclays has invested in a new Vantage platform to support strategic initiatives in advanced analytics, and a modernization of its enterprise decision capabilities. And an S&P 500 oil and gas producer selected Vantage delivered as a service to acquire and integrate real-time sensor data from its fleet of rigs, helping to drill wells safer, faster and on target. And our drilling data as a service solution delivers answers on mobile and desktop devices. These are just a few examples that illustrate Vantage is changing the game for our customers and they are recognizing its power to deliver answers to all parts of their organization. The unmatched power of Vantage is also strengthening our competitive position. We are winning against both newer cloud startups and our traditional competitors. In the quarter, we beat Snowflake in a number of opportunities. The amount of negative feedback we are hearing on overpromised Snowflake capabilities is increasing. Companies are having to add more technology to try to get Snowflake working, but even then, it does not meet performance expectations or deliver enterprise business results. Here are a few examples of our competitive wins. We won against a cloud competitor at Sony Pictures Entertainment. helping Sony achieve success in maximizing value in sales forecasting, green lighting, competitive information, and customer experience. One of the largest European DIY megastore chains is adding Vantage for retail analytic business cases. The retailer extensively considered competitive offerings, but Vantage's capabilities demonstrated the power of pervasive data intelligence and won the deal. A major American professional sports league signed up for Vantage as a service, running on EWS, leveraging the significant analytic capabilities of Vantage to better understand lifetime value, drive personalized targeting and messaging to enhance its fan experience. We won despite the company's longstanding partnership with a competitor. Vantage is tailor-made to help enterprises get the most return from their investments and focus on what truly matters, getting answers, not managing their IT infrastructure. With our recently announced SS service offerings, we are now further helping customers simplify their operations and drive an improved experience of adopting and leveraging Vantage to help them expand their analytic use cases, whether on-prem, in the cloud, Our technology is getting serious recognition from leading industry analysts, demonstrating that our offerings are meeting customer and market needs and that our technology innovation continues. Teradata ranked the highest in every use case in Gartner and provides excellent external validation that our strategy is on point. And Terada was again named as a leader in Gartner's magic quadrant for data management solutions for analytics. We were recognized for our ability to simplify analytical ecosystems with Terada Vantage and our focus on delivering analytics that matter. Lastly, Terada was acknowledged for our market leading customer data management and analytics capabilities in Forrester's Wave for real-time interaction management. This recognition demonstrates that we are driving market-changing innovation. So as I turn the call to Mark, I would like to remind you of my four key takeaways. First, we have made significant progress in executing our strategy. Second, we are seeing strong demand and adoption for Teradat Advantage and are increasing our competitive position. Third, our new as a service offerings for Vantage help customers focus on getting the answers they need rather than managing their infrastructure. And finally, our innovations continue to garner outstanding recognition. The Teradata team remains persistent in our drive to increase our momentum, advance our market leadership, beat the competition, and set the bar high for the entire industry. We are moving faster than ever before and the Teradata team is leading the conversation around the power of data to reshape the world. By the way, challenging the status quo and moving at such an accelerated pace is not easy and I want to reinforce how proud I am of our Teradata people in their commitment to execute our strategy, make a difference and win. This team is energized, focused and committed to bringing value to our customers and shareholders. And I could not be more proud of our outstanding people. Now, let's turn to Mark.